Most individuals only consider insurance in the event of a loss, injury, or accident. In times like these, you have the greatest need for financial support, and this is when your insurance company must step up and provide the necessary financial assistance. Life insurance is now a necessity, particularly for the primary breadwinner in the family. The advantages of purchasing a life insurance policy extend far beyond protecting the policyholder’s family during difficult times. Insurance policies can serve as a financial buffer, become a tool for saving money, and provide peace of mind. A person is typically spoiled for choice when it comes to purchasing an insurance policy. There are numerous life insurance policies which provide the policyholder with multiple benefits. This means that you must do your research to confirm that the insurance coverage you purchase can protect the health, assets, and financial well-being of your family. Before subscribing to a policy, one must carefully examine and evaluate a few policy-related factors, as all available options differ (Maseke, and Iipinge, 2021).

Before purchasing a life insurance policy, it is crucial that you fully grasp what is and is not included in the policy’s coverage. Inclusions are the parts of your life insurance policy that will actually pay out. Because of these extras, it’s definitely worthwhile to invest in this life insurance coverage. In other words, if any of these insured occurrences occur, you will receive financial compensation. However, the additions would outline the conditions under which the beneficiary would receive death payments. Knowing what your coverage covers will allow you to make better use of it. In addition to the standard coverages, some insurance companies automatically include optional extras. Accidental death benefits, critical sickness insurance, monthly payments for a set period of time after a lump sum payout (Tatti and Balthazar, 2018).

An exclusion is a clause in a policy that specifies a certain risk is not covered. What I mean is that there are things that happen that the insurance won’t pay for. Before purchasing an insurance policy, it is important to review the exclusions in detail to ensure that your needs will be met. If you want to be ready for anything that can happen, you should study your insurance policy carefully and learn about the situations and occurrences that are not covered. Preexisting conditions, accidental death, lifestyle-related illnesses, and suicide are frequently not covered (Tatti and Balthazar, 2018).

Restrictions are provisions in life insurance policies that stipulate certain conditions. It’s important to learn about these limitations before purchasing a policy, as being uninformed can lead to a negative claim experience and even financial losses. Common limitations include an age threshold below which coverage cannot be obtained, an age threshold above which coverage must be terminated, a minimum and maximum term assurance rider, a maximum sum assured, etc. If you are aware of the limitations, you can select the policy that will serve your needs the best.

There is a correlation between a life insurance company’s claim settlement ratio and the quality of their customer service. Total claims settled during a given time period are then divided by the total claims received during that time period to determine the percentage of claims resolved during that time period. A high and stable claim settlement ratio suggests that when legitimate claims are filed, the insurance company acts swiftly and firmly to pay out benefits. This is extremely important to consider when purchasing a life insurance policy, as the beneficiary’s claim is the policy’s primary benefit (Mathur & Tripathi, 2014).

A life insurance policy that has lapsed is no longer an active contract. When premium payments are not paid on schedule and the grace period has passed, an insurance policy will lapse. However, insurance firms offer the option to revive a lapsed policy within a specified time frame following the grace period by paying the unpaid premium and a specified amount of interest on the unpaid amount. This is the period of revival. Currently, the time is two years, and policyholders must be aware of any changes to associated rules (Tatti and Balthazar, 2018).

A life insurance policy add-on rider is an attachment, amendment, or endorsement that provides the policyholder with additional coverage. Riders enhance an insurance policy by providing multiple additional benefits in addition to the basic death benefit. To protect your family's future, you must verify the availability of supplemental coverage in addition to the policy. Common riders include accidental death benefit riders, accidental disability benefit riders, critical illness benefit riders, premium waiver riders, and income benefit riders, among others.

(Mathur & Tripathi, 2014).

The policyholder should be aware of the rules and restrictions that apply before attempting to convert a term life policy to a whole life or endowment plan. Most notably, the conversion provision eliminates the need for a medical exam when switching from a term policy to a whole life or endowment policy. This is something to think about if your health starts to deteriorate after you’ve already purchased a term policy (Bonner, 2018).

The purchase of a life insurance policy should only be made after careful consideration of all policy terms and conditions. You can also talk to a professional for advice; they’ll be able to show you the ropes and highlight the key metrics that need your attention. You can protect your family’s financial stability with just a little bit of forethought and careful planning.

Tati, R. And Baltazar, E. (2018) Factors Influencing the Choice of Investment in Life Insurance Policy. Theoretical Economics Letters, 8, 3664 - 3675. Doi: 10.4236/tel.2018.815224.

Mathur, D. And Tripathi, A. (2014) Factors Influencing Customer’s Choice for Insurance Companies—A Study of Ajmer City. IOSR Journal of Business and Management, 16, 35-43.

Maseke, B.F. and Iipinge, D.N. (2021) Factors Influencing Clients in Choosing Insurance Companies. Open Access Library Journal, 8, 1-11. Doi: 10.4236/oalib.1106944.

Mathur, D. And Tripathi, A. (2014) Factors Influencing Customers’ Choice for In-surance Companies: A Study of Ajmer City. LOSR Journal of Business and Man-agement, 16, 35-43